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Mar 16, 2020 | Post by: Roman Chuyan, CFA Comments Off on This Is a Bear Market

This Is a Bear Market

Roman Chuyan, CFA March 15, 2020 Our fundamentals-based process has helped protect against the entire downturn so far. Stocks are cheaper, but economic factors are now negative, and so is our outlook for the S&P 500. I describe developing themes (earnings, economic) that might continue to pressure markets. All major

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May 12, 2016 | Post by: Roman Chuyan, CFA Comments Off on Inflation Will Push Fed To Act

Inflation Will Push Fed To Act

Roman Chuyan, CFA May 12, 2016 The Fed (and other central banks globally) helped keep bond, stock and other asset prices elevated, in the face of negative fundamentals including economic and valuation. How will the tug-of-war between fundamentals and the Fed be resolved? One possible scenario: inflation reaches the Fed’s target

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Apr 29, 2016 | Post by: Roman Chuyan, CFA Comments Off on When Will Stocks Plunge?

When Will Stocks Plunge?

Roman Chuyan, CFA April 29, 2016 “There is some limit beyond which it becomes totally unreasonable to divorce highly elevated asset prices from sluggish fundamentals.” ~ Mohamed El-Erian, The Only Game In Town Introduction The current bull market in equities has been nothing short of spectacular. It lasted for over

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Apr 20, 2016 | Post by: Roman Chuyan, CFA Comments Off on U.S. Economy Is Now In Stagnation – What’s Next?

U.S. Economy Is Now In Stagnation – What’s Next?

Q1 GDP growth reached stalling speed, at 0.3%. Inventory-to-sales ratio, at 15-year high, will be a headwind to economic growth. Contrary to positive ISM survey, manufacturing dropped by 0.3% last month. Investors couldn’t care less, but I think an inflection point is approaching. The International Monetary Fund cut its 2016

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Apr 11, 2016 | Post by: Roman Chuyan, CFA Comments Off on Are The S&P 500 Earnings $125, $118 Or $99?

Are The S&P 500 Earnings $125, $118 Or $99?

Earnings are reported on Net, Operating, or Adjusted basis. Forward 2016 EPS estimates of $125 or $118 are likely overstated, especially given that earnings are declining. TTM earnings are $100.5, to decline to around $99.4 when Q1 is reported. Given very high valuation, it’s hard to imagine how stock averages

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Mar 31, 2016 | Post by: Roman Chuyan, CFA Comments Off on Economic Downshift – Are We Even Moving?

Economic Downshift – Are We Even Moving?

Summary Economic numbers for February point to a downshift in in activity. The Fed’s GDPnow model estimates Q1-2016 annualized growth to slip to 0.6%. Investment implications include reduced USD outlook and positive view on TIPS and gold. February Data The latest U.S. economic numbers for February point to a downshift

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Mar 16, 2016 | Post by: Roman Chuyan, CFA Comments Off on In Fed We Trust?

In Fed We Trust?

There is some limit beyond which it becomes totally unreasonable to divorce highly elevated asset prices from sluggish fundamentals. ~ Mohamed El-Erian, The Only Game In Town The Federal Reserve’s meeting results will be in focus today. According to consensus expectations, there’s no chance of the Fed raising the interest

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Mar 04, 2016 | Post by: Roman Chuyan, CFA Comments Off on Will The ECB Awe Or Disappoint?

Will The ECB Awe Or Disappoint?

Investors will be watching the European Central Bank’s monetary policy meeting on Mar 10th. The ECB’s fight against deflation using negative ECB deposit interest rate (now at -0.3%) and a 1.5 trillion-euro bond-buying plan has made little visible progress: economic growth and inflation remain absent from the Eurozone. Finance authorities

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Feb 22, 2016 | Post by: Roman Chuyan, CFA Comments Off on Real Economy Unaffected by Market Turmoil –

Real Economy Unaffected by Market Turmoil –

After a 10% US equity market correction this year, the important question was whether it would affect the real economy. It hasn’t. Economic activity by consumers and businesses (other than commodity-driven sectors) isn’t affected (at least, not yet) by the turmoil. The latest economic statistics show continued strength in the U.S. domestic

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Jan 25, 2016 | Post by: Roman Chuyan, CFA Comments Off on Stocks Remain Overvalued

Stocks Remain Overvalued

The 7% drop in the S&P 500 this month was significant by some measures. For example, investor sentiment moved to levels of bearishness rarely reached since the financial crisis: AAII’s individual investor bear/bull ratio stands above 200%, an extreme level of negativity rarely seen outside of 2008-09. But, how much

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